Trade Analysis and Tips for Trading the Japanese Yen

The test of the 157.07 price level occurred at a moment when the MACD indicator had already moved significantly upward from the zero line, which, in my view, limited the dollar's upward potential. For this reason, I did not buy the dollar.

In the second half of the day, attention should be paid to the weekly data on initial jobless claims, as well as a speech by FOMC member Raphael Bostic. A rise in claims could negatively affect the overall picture that traders have seen this week regarding the U.S. labor market. The ADP report was disappointing, and unemployment data have been postponed until next week, so if jobless claims also jump sharply, the dollar may undergo a slight correction against the Japanese yen. Equally important is the speech by Raphael Bostic, an FOMC representative. His comments on the economic environment, inflation, and monetary policy outlook may provide investors with important insights into the Fed's next steps. In the event of a hawkish stance, the dollar will certainly take advantage of this, leading to another upward surge in USD/JPY.

As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, I plan to buy USD/JPY upon reaching the entry point in the level of 157.31 (green line on the chart), targeting growth toward the 157.68 level (the thicker green line on the chart). Around 157.68, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move in the opposite direction from that level). A rise in the pair today can be expected after strong U.S. data.Important! Before buying, make sure that the MACD indicator is above the zero line and just beginning to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today if there are two consecutive tests of the 157.04 price level while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth toward the opposite levels of 157.31 and 157.68 can be expected.

Sell Signal

Scenario No. 1: Today, I plan to sell USD/JPY after a break of the 157.04 level (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be the 156.73 level, where I will exit short positions and also immediately open long positions in the opposite direction (expecting a 20–25 point move in the opposite direction from that level). Pressure on the pair will return in the event of weak data.Important! Before selling, make sure that the MACD indicator is below the zero line and just beginning to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today if there are two consecutive tests of the 157.31 price level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. A decline toward the opposite levels of 157.04 and 156.73 can be expected.

What's on the Chart

• Thin green line – entry price at which the trading instrument can be bought;
• Thick green line – estimated price at which Take Profit can be set or profits can be taken manually, as further growth above this level is unlikely;
• Thin red line – entry price at which the trading instrument can be sold;
• Thick red line – estimated price at which Take Profit can be set or profits can be taken manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to rely on overbought and oversold zones.

Important. Beginner Forex traders should be extremely cautious when making decisions about entering the market. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can very quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for an intraday trader.